function [r2_mm, p2_mm, delta_p_mm, ...
    s2_mkt_mm, claims2_mm, pr_s_mm] ...
    = shell_expand_agg(r2, p1, s1_predicted, D_claims2, D_pr_s, D_pr_mm, ...
    eta_mm, gamma_mm, N_ist, K, M, delta)

% rate increases in %
r2_mm = expand_agg_states(r2, repmat(eta_mm,N_ist,1)); % N.ist x K*M

% 2nd-stage prices conditional on all agg stages=(k,l,n)
p2_mm = repmat(p1,1,K*M).*(1+0.01*r2_mm); % N.ist x K*M

% rate differences
delta_p_mm = p2_mm-repmat(p1,1,K*M); % N.ist x K*M

% 2nd-stage mkt shares
s2_mkt = repmat(s1_predicted, 1, K).*repmat(1-delta, N_ist, 1); % N.ist x K
s2_mkt_mm = expand_agg_states(s2_mkt, ones(N_ist, M)); % N.ist x K*M

% claims
claims2_mm = expand_agg_states(D_claims2, repmat(gamma_mm,N_ist,1)); % N.ist x K*M

% distribution of all agg states s=(k,l,m)
pr_s_mm = expand_agg_states(D_pr_s, D_pr_mm); % N.ist x K*M